NOW PLAYING

Obama vows to 'fight' BP oil spill

US president pledges to use "everything we've got" to stop giant Gulf of Mexico spill.

16 Jun 2010 00:36 GMT

BP's stock price has tumbled as it faces more scrutiny over its handling of the oil spill [Reuters]

Obama spoke about what his administration was doing to clean up the oil, help those affected by the spill and "make sure that a catastrophe like this never happens again".

The president's first televised Oval Office address appeared aimed at showing his leadership in tackling the crisis in the face of criticism among some Americans that he reacted too late.

The disaster has cut severely into Obama's schedule, including threatening his legislative agenda on such issues the overhaul of financial regulation, climate change and immigration reform.

Financial hit

Obama's speech came on the same day that executives from BP and other major oil companies such as Exxon Mobil, Chevron, ConocoPhillips and Royal Dutch Shell, were defending their drilling practices at a congressional hearing in Washington.

IN DEPTH

The accusations of choosing profit over safety come as BP, a listed company which has lost about half its market value since the spill began almost two months ago, was stripped of its AA debt rating by ratings agency Fitch.

The downgrade follows a precipitous 9 per cent fall in BP's shares on Monday after more than 50 Democratic senators proposed that the company make a $20bn payment into an independently managed account to cover compensation for victims and the clean-up.

US politicians have also been calling on BP to scrap its quarterly dividend to ensure it has enough money on hand to cover any costs.

BP shares trading in London closed down 5.52 per cent at 342 pence on Tuesday.

The April 20 explosion on an offshore rig killed 11 workers and ruptured BP's well.

The spill has fouled 190km of US coastline, imperilled the multibillion-dollar fishing and tourism industries and killed birds, sea turtles and dolphins.

The oil gusher, 1,600 metres deep in the Gulf, which the US government does not have the technology to stop, has forced Obama and the federal government to rely on BP for an eventual fix.

That is not likely to happen until a relief well penetrates the blow-out in a couple of months.

On Wednesday, Obama will meet BP executives at the White House to discuss damage claims and the next steps in stopping the leak.